| Feature | CRSC | CRDP |
|---|---|---|
| Full name | Combat-Related Special Compensation | Concurrent Retirement & Disability Pay |
| Who qualifies | Retirees with combat-related disabilities (any VA rating) | Retirees with 50%+ VA rating (any disability type) |
| Tax treatment | 100% Tax-Free | Taxable as retirement income |
| Application required | Yes — DD Form 2860 to your branch | No — automatic if eligible |
| Effective date | Date of application to your branch | Date you became eligible (automatic) |
| Max payment | Limited to VA disability compensation amount | Restores full retired pay offset |
| Phased in? | No — full amount immediately | Fully phased in since 2014 |
| Can you elect? | Yes — you elect CRSC over CRDP | Default if you don't elect CRSC |
Combat-Related Special Compensation (CRSC) is a monthly, tax-free payment for retired servicemembers whose VA disability ratings are connected to combat or hazardous duty. Unlike CRDP, CRSC is not automatic — you must apply and your branch's CRSC board must approve the combat connection.
The CRSC definition of combat-related is broader than most veterans expect. Your disability qualifies if it was incurred in:
Notably, PTSD from combat, hearing loss from weapons fire, and injuries from vehicle accidents during deployment all typically qualify. Repetitive overuse injuries from normal duties typically do not.
Concurrent Retirement and Disability Pay (CRDP) restores the portion of military retired pay that a veteran gave up to receive VA disability compensation — a system known as the "VA waiver." Before concurrent receipt laws were passed, receiving VA disability compensation reduced your military retirement check dollar-for-dollar. CRDP eliminated that offset for eligible veterans.
CRDP requires no application — if you're eligible, Defense Finance and Accounting Service (DFAS) automatically pays it. The amount equals the portion of retired pay you waived to receive VA compensation. It is taxed as ordinary retirement income.
Say a veteran qualifies for $1,200/month under either program. Under CRDP, that $1,200 is taxable retirement income. In the 22% federal tax bracket, the veteran nets about $936/month. Under CRSC, all $1,200 is tax-free — no federal income tax on that amount. That's an extra $264/month, or $3,168/year, just from the tax treatment. For veterans in higher tax brackets, the gap is even larger.
Your CRSC payment is the lesser of two amounts:
In plain English: CRSC can restore up to the amount of retirement pay you gave up for VA comp — but only for disabilities the CRSC board certifies as combat-related. If only some of your disabilities are combat-related, only those disabilities count toward CRSC.
CRDP simply restores the full VA waiver amount — the dollar-for-dollar reduction in your military retirement check. If your gross military retirement pay is $3,000/month and your VA disability compensation is $1,500/month, you receive the full $3,000 retirement plus the full $1,500 VA comp under CRDP (rather than $1,500 retirement + $1,500 VA comp under the old system).
The restored retirement pay under CRDP is taxable. Your VA disability compensation remains tax-free regardless.
The following examples use 2026 VA compensation rates. Federal tax calculations assume a 22% marginal rate for illustration — your actual tax situation may differ. Consult a tax advisor for precise calculations.
VA compensation (70%, single veteran): $1,663.06/month
VA waiver amount: $1,663.06/month (reduces retirement pay by this amount)
Net military retirement under old system: $736.94/month
After-tax difference: CRSC puts $366 more per month ($4,392/year) in this veteran's pocket purely from tax savings.
VA compensation (90%, single veteran): $2,241.91/month
VA waiver amount: $2,241.91/month
CRSC eligibility: None — disability not combat-related
Lesson: If your disabilities aren't combat-related, CRSC isn't available to you. CRDP is automatic and still highly valuable — this veteran recovers $2,242/month in restored retirement pay.
VA compensation (80%, single veteran): $1,995.01/month
Combat-related portion certified by CRSC board: 40% (PTSD + hearing loss) = $731.86/month CRSC
CRDP amount: $1,995.01/month (restores full waiver)
Lesson: When only some disabilities are combat-related, CRSC may be dramatically lower than CRDP. Run the numbers — in this case, CRDP wins by $824/month after tax.
VA compensation (100%, single veteran, 2026): $3,737.85/month
VA waiver: $3,737.85/month
CRSC amount: $3,737.85/month (all disabilities combat-related)
After-tax difference: CRSC saves this veteran approximately $11,964/year in federal income taxes. For 100% combat veterans, CRSC is almost always the better choice.
VA compensation (50%, single veteran): $1,075.16/month
Chapter 61 disability retirement pay: $1,800/month gross
Note: Chapter 61 retirees with less than 20 years face special CRSC/CRDP rules
Lesson: For medical retirees, the gross amounts are often equal — which makes the tax difference decisive. Qualifying for CRSC is worth pursuing aggressively.
CRSC beats CRDP in after-tax income when the tax savings on the CRSC amount exceed any difference in gross amounts. The formula:
CRSC advantage = (CRDP gross × your marginal tax rate) − (CRDP gross − CRSC gross)
In plain English: CRSC wins when your tax bracket multiplied by the CRDP amount is greater than the difference in gross amounts. For most veterans in the 22% or 24% bracket, CRSC wins whenever the CRSC amount is within ~25% of the CRDP amount.
For a precise calculation based on your specific retirement pay, VA rating, and tax situation, use our interactive CRSC vs CRDP calculator. It walks you through your gross amounts, applies current 2026 VA rates, and shows your after-tax take-home for both options.
CRSC requires a formal application to your branch's CRSC board — it is not automatic like CRDP. Here's exactly how to apply:
You need a military retirement (20+ years or medical), a VA disability rating, and at least one condition you believe was combat-related under the definitions above. Check your VA rating decision to confirm you're currently receiving VA compensation.
DD Form 2860 is the CRSC application form. Download it from the DoD forms website or your branch's CRSC office website. Complete Section I (personal information), Section II (retirement and VA information), and Section III (list of combat-related conditions with supporting documentation).
The CRSC board needs to verify that your disability was incurred during combat or hazardous duty. Gather:
Each branch has its own CRSC office:
CRSC boards typically take 60–120 days to process applications. If approved, your CRSC payments begin with the next pay period after approval. If denied, you can appeal to the branch's Board for Correction of Military Records (BCMR/BCNR).
CRDP requires no application. DFAS automatically begins CRDP payments when:
If you believe you're eligible for CRDP but aren't receiving it, contact DFAS at 1-800-321-1080. Bring your VA rating letter and military retirement account number. Errors in DFAS records are the most common reason eligible veterans miss CRDP payments.
Use our interactive calculator to see exact dollar amounts for your specific retirement pay, VA rating, and disability mix — including after-tax comparisons.
Open the CRSC vs CRDP Calculator →It depends on your situation. CRSC is tax-free but limited to combat-related disabilities. CRDP is taxable but available to all retirees with 50%+ ratings. Veterans with mostly combat-related disabilities in the 22%+ tax bracket often do better with CRSC. Veterans with non-combat disabilities or lower CRSC eligibility almost always benefit more from CRDP.
No. You cannot receive both simultaneously. You must elect one or the other. Your branch will pay whichever is higher by default, but you can specifically elect CRSC if you prefer the tax-free treatment.
There is no hard deadline, but CRSC benefits are not retroactive beyond 6 years from your application date. Every year you delay potentially means lost back pay. Apply as soon as you believe you qualify.
Both programs restore the VA waiver — the retirement pay you gave up to receive VA compensation. Under CRDP, the restored amount is taxable. Under CRSC, it's tax-free. In the 22% tax bracket, a $1,000 monthly payment is worth $220 more per month under CRSC than under CRDP.